Millions of Palestinian refugees "cannot simply be wished away," the head of a UN support agency said on Monday, hitting back at a U.S. aid cutoff and allegations its work only perpetuates their plight.

The United Nations Relief and Works Agency provides services to about 5 million Palestinian refugees across Jordan, Lebanon, Syria and the West Bank and Gaza. Most are descendants of some 700,000 Palestinians who were driven out of their homes or fled fighting in the 1948 war that led to Israel's creation.

Palestinian refugee students stand outside a classroom as they wait to mark the return to school for a new year at one of the UNRWA schools, in Beirut, Lebanon, Monday, September 3, 2018Hussein Malla,AP

The growing refugee count was cited by Washington, UNRWA's biggest donor, in its decision last week to withhold funding, and has potential ramifications for the Palestinians' pursuit of a right of return to land now in Israel.

Successive Israeli governments have ruled out such an influx, fearing the country would lose its Jewish majority. "I express deep regret and disappointment at the nature of the U.S. decision," UNRWA Commissioner-General Pierre Krahenbuhl said in an open letter to Palestinian refugees and the agency's staff in which he pledged its operations would continue.

Appearing to echo Israel's view that descendants of the 1948 refugees should not share that status, State Department spokeswoman Heather Nauert criticised UNRWA on Friday over its "endlessly and exponentially expanding community of entitled beneficiaries."

But Krahenbuhl said "the protracted nature of the Palestine refugee crisis" was not unique. He said the children and grandchildren of long-displaced refugees in Afghanistan, Sudan, Somalia, Congo and elsewhere are also recognised as refugees and assisted by the United Nations.

"No matter how often attempts are made to minimise or delegitimise the individual and collective experiences of Palestine refugees, the undeniable fact remains that they have rights under international law and represent a community of 5.4 million men, women and children who cannot simply be wished away," he said.

The United States paid out $60 million to UNRWA in January, withholding another $65 million, from a promised $365 million for the year. Krahenbuhl said Gulf states had injected funds but UNRWA still needed more than $200 million.

In Lebanon on Monday, UNRWA opened its school year as scheduled. Studies in UNRWA-run schools in the occupied West Bank and the Gaza Strip got under way on Wednesday.

Claudio Cordone, director of UNRWA Affairs in Lebanon, told Reuters that funds would last only until the end of the month but the agency would continue to raise money to ensure the schools remain open. Washington's move against UNRWA was the latest in a series of U.S. and Israeli policy decisions that have angered Palestinians and raised international concern.

They include Trump's recognition of Jerusalem as Israel's capital in December, the moving of the U.S. Embassy to the contested city in May and Israel's adoption of a "nation-state" law in July that says only Jews have the right of self-determination in the country.

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